Property tax agreement proposed for Providence’s Kinsley Building up for review

PROVIDENCE, R.I. — A City Council committee will discuss a proposed tax stabilization agreement for the Kinsley Building later this month as it continues a review of property tax deals the city has struck over the last 20-plus years.

PROVIDENCE, R.I. — A City Council committee will discuss a proposed tax stabilization agreement for the Kinsley Building later this month as it continues a review of property tax deals the city has struck over the last 20-plus years.

Developer Arnold “Buff” Chace is seeking a 12-year stabilization agreement for the Kinsley building, a Westminster Street building his Cornish Associates development firm purchased in 2013.

Cornish paid $1.2 million to buy the five-story building at 334 Westminster St. from Johnson & Wales University. The company plans to create 44 apartments on the upper floors with shops and or restaurants at ground level.

The agreement — with Cornish subsidiary Downcity Revitalization Fund I LLC — would exempt the building from property taxes for the first three years after the deal is signed, according to a city document. Taxes would kick in for the fourth year, at the lesser of $20,000 or 11.11 percent of “full assessed value.” In the fifth year, taxes would be the lesser of $30,000 or 22.22 percent of assessed value. Taxes would continue to increase by increments of 11.11 percentage points until the 12th year, when the rate would be 95 percent of full assessed value. The full tax rate would apply in subsequent years.

The City Council’s Special Committee on Ways and Means is set to review the proposed agreement Monday, Feb. 24.

The proposal comes as the committee examines a series of budget-related questions this winter, including the “public benefits” of commercial property tax breaks struck by the city over the last 20-plus years.

Mayor Angel Taveras favors halting the agreements altogether, promoting a freeze on the commercial tax rate to bring it more in line with those in similar cities. For now, he’s limiting agreements to 12 years.

At least 12 tax stabilization agreements that may yield approximately $17 million in tax savings over their lifetimes have been approved by the city since Taveras took office in January 2011.